All Forum Posts by: Brenden Mitchum

Hey @Gail Shulski, welcome to the BP Community!

Your best bet would be to ask the PML just to double check everyone is on the same page. They should provide you with something that tells you what your monthly payment will be before closing.

That being said, the calculation is fairly simple. However, I am not sure if you're saying the purchase is $150k or if that's the loan amount. For the following calculations I'll assume $150k is the loan amount.

 12% of $150k is your annual interest-only payment. .12*150,000=18,000. So $18k is the amount you'd have to pay in interest for the year. Divide that by 12 to get your monthly payment. 18,000/12=1,500. So, $1500 should be your monthly interest-only payment. This is assuming you pay the points up front and don't wrap them into the loan. If you wrap them into the loan, just add 2% to $150k and work through the same calculations I just did. 

The balloon payment should be the loan amount minus 6 payments. 150,000-6*1,500=141,000. So, your balloon payment at month 7 should be $141k. Again, this will differ slightly if you wrapped points into the loan. 

I hope this helps a bit. Please, feel free to reach out anytime if you have other questions or just want to chat!

Hey @Niko Nomura, welcome to the BP Community!

My advice largely depends on where you're located. $12.5k should be enough to lock up a house hack in an affordable area with home values in the $200s or below. If this sounds like where you're at, great! Then, my advice would be to get yourself into a house hack as soon as possible. A small MF would be ideal but don't be afraid to hack a SF if it has an in-law suite. If you can find one close to campus, it may even be a good move to rent by the bedroom to your fellow students. Just make sure you understand your municipality's occupancy laws before doing so!

If you're in an area where finding something under $300k would be nearly impossible, just sit tight and focus on saving, learning & networking. You could get into wholesaling but that takes some real time commitment to do it right. Don't even think about starting down that path unless you're committed, or else you'll just waste your time. 

Getting started should be your focus but don't worry too much if that just isn't in the cards with now. After graduation, you'll be younger and have more knowledge than most of us had at the beginning. Just make sure you're ready and have a plan to get started shortly after graduation. 

And please, feel free to reach out anytime if you have other questions or just want to chat RE!

Hey @Rene Cazanas Jr, happy to help!

Best way to vet a lender is to get feedback from other investors. You can ask them directly for referrals but some may not be comfortable giving out their clients contact info. You could also post here in the Ohio forums asking others for feedback on that lender. Make sure you include the city and state you're looking to invest in so that you get more visibility through keywords. Try Facebook Groups too! If no one has heard of them, you might want to find a different lender..

Outside of this and checking they actually exist, you'd also want to formally interview the company. Ask about their experience in real estate and their terms. Oftentimes, just an in-depth conversation on the process can throw up some red flags. 

Hey @Madalyn McCurdy, welcome to the BP Community!

Looks like you just revived an almost decade old post haha. Not your fault though - BP's search tools is the pits. 

If you're still looking to get out to some in-person events, there were tons before Covid and I'm sure there are more than a few now. A great place to check is the Events page here on BP (scroll to the bottoms). Also, take a look at meetup.com & local REIAs (ATLREIA & GaREIA).

Hope this helps a bit - please, feel free to reach out anytime if you have other questions or just want to chat!

@Rene Cazanas Jr

It's absolutely possible to get a 90% LTV loan as a newbie. The two obvious options that I know of are owner-occupied loans (house hacking) and second home loans (vacation rental). You can get as low as 3% down with owner-occupied conventional on a single family home (even lower with some lenders). For a second home loan, you'd get as low as 10% down (pretty sure that product is conventional too).

There are other options such as hard money products but those are more difficult to get with zero experience and points+rates will be higher. 

Hey @Nickolas Graham, welcome to the BP Community!

The short answer is that you really cannot fully control whether or not the loan is called due. That being said, the last thing a bank wants is a foreclosure to occur on a performing asset. They're in the business of lending, not property ownership. Unfortunately, even though the chance of this happening is so small, the repercussions are fairly significant. The best way to protect yourself is to have a worse case scenario plan, which will likely involve a refinance. 

As far as the payments, most systems are online these days so you can simply change over login info to give you full control. You should absolutely have your own insurance though, rather than assuming theirs.

Really the hardest part is just getting your mindset right when it comes to that due on sale clause. There are very few strategies out there that are more profitable and carry similar or lower risk as less profitable strategies. @Mitch Messer, have you heard of anyone involved in a Sub2 deal that had the loan called due? Any advice for Nickolas on protecting himself?

Hope this helps a bit. Please, feel free to reach out anytime if you have other questions or just want to chat!

Hey @Rene Cazanas Jr, welcome to the BP Community!

Unfortunately, the short answer to your question is yes, that would be unrealistic. 

Any formal company lending money to a newbie investor will not be okay with taking a second position behind the conventional lender. Your best bet here would be to partner with friends or family on the down payment. Or, keep networking and saving money. Eventually, you will have enough to invest or will come across an opportunity that will allow you to get into the game with less down. 

Don't forget about owner-occupied, low-down loans. If this is an option for you, house hacking is a great way to get started with less capital!

Hope this helps a bit! Please, feel free to reach out anytime if you have other questions or just want to chat.

Hey @Chandler Butler

Getting your license is a great first step to separate yourself from the crowd. Most wholesalers I speak to here in Atlanta don't have their license. It will also allow you to work for large wholesale brokerages, which is a great way to get started. Plus, there's a chance that, like other states, GA may one day require a license for anyone selling real estate. Better to already have it than scramble for it later..

Most investors just want a partner to help them find great deals. If that's who you are, you'll do just fine. However, if you're just in it for the $$, you'll find yourself as the subject of those horror stories. Work hard, do the right things, be a genuinely nice/friendly guy & investors will love working with you.

And please, feel free to reach out anytime!

Hey @Jayme Currie, thanks so much for the suggestion! I'm with EXP so have tried out kvCore. I actually switched to my current CRM from kvCore for a number of reasons. However, the biggest issue here would be the pricing. In order to bring a cold calling team on, I would have to pay for an account for each of them and kvCore is crazy expensive. 

Hey @Robb Silverstein

I am no STR pro but can still help provide a little insight on your questions.

First, make sure you look into the new STR laws within the city of Atlanta. I've read multiple forum posts and an article saying these are changing (or have changed) and you now need to be an Atlanta resident to open up new STRs.

Now, your questions:

1. Not hard at all. You just need to find the right contractor to help with this. Most of my clients are out of state and invest in co-living spaces. They are fully furnished and our contractor is responsible for this. 

2. They get a bad rep and have less competition for a reason...this isn't to say you can't run a successful condo rental. However, it will just take time and proper due diligence to find the right one. Also, Atlanta suburbs have mostly detached homes so supply of condos and townhomes are fairly limited. You will be competing with the hundreds (maybe thousands) of folks looking for affordable housing because SFH values have skyrocketed. So, don't necessarily assume it'll be a cake walk getting anything you like under contract. I have not personally owned a condo but know folks who have and sold because of increased HOA restrictions and fees. That's just something you cannot control and successful investors typically like to control as much as they can to make investing a science vs. just hoping for best results.

3. Not that I know of. Think about it. In order for this to be a thing, you would need one of two occurrences: 1. Every association to keep their rules and regulations organized within a single system that the public has access to. 2. An individual or company go around and speak with every association and log their rules and regs in a single system and make it public. Would be awesome if either of these happened though! That being said, your agent should be able to tell you when looking at a listing through the MLS whether or not it has rental restrictions. They should also be following up with the listing agent to double check. You don't need to spend hours doing this unless you're trying to source these off-market.

Hope this helps a bit! Please, feel free to reach out anytime if you have other questions or just want to chat about the Atlanta market!